Contract to nonprofit involving city employees

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Updated 10:40am March 27, 2021, to include a statement by Council Member Mackenzie Kelly, that was inadvertently left out of the story when published.

$650,000 no-bid social services contract awarded to Equidad ATX 

The Austin City Council on Thursday on consent approved negotiation and execution of a $400,000 no-bid contract with a one-year extension of $250,000 for Equidad ATX Inc.

Two current city employees and one former city employee are involved with Equidad ATX Inc.

Kazique Prince

Kazique Jelani Prince and Alba Sereno are both listed on the website of Equidad ATX Inc. as part of the “Equidad Team.” In addition, both are listed in the organization’s 2019 tax return as being on its board of directors.

Alba Sereno

Prince is a senior policy advisor in the office of Mayor Steve Adler and Sereno is an I-Team Project Lead in the City’s Innovation Office, according to city webpages. The City’s Public Information Office said in an email, “Sereno was the Project Lead in the Innovation Office until last year until she went on a special assignment for the Deputy City Manager’s Office last year.”

Ashton Cumberbatch Jr.

The organization was founded by attorney Ashton Cumberbatch Jr., who once served as Austin’s Police Monitor and more recently was a policy advisor to Mayor Steve Adler, according to his résumé published on the McGinnis Lochridge law firm’s website.

Steve Adler

Mayor Steve Adler in leading up to the vote on the consent agenda took a moment to single out the program. “I think that Item Number 51, which is a contract with Equidad for the mobile food services, is really needed. And I want to thank and commend Ashton Cumberbatch for that organization’s involvement in taking an old, a repurposed Cap Metro bus, to get resources where they’re most needed. I think (that) is great.”

The mayor’s praise, however, did not dissuade Council Member Mackenzie Kelly from including Item 51 on a list of some 10 consent agenda items for which she wanted to be shown as voting no.

Mackenzie Kelly

Update: “After reading the backup material and looking at the costs associated with this agenda item, I’d have felt more comfortable if as a council we’d explored a most cost-effective and permanent solution for the needs expressed in this agenda item,” Kelly told The Austin Bulldog.

“I am also concerned about conflict of interest but I did not have enough info at the time to determine that or make a public statement.”

When responding to the Bulldog’s voice message requesting an interview, Prince, via text message, directed The Austin Bulldog to speak with Cumberbatch about Equidad ATX.

Cumberbatch did not respond to voice and text messages for this article.

Prince did not respond to additional text messages pointing out that it seems unusual for city employees to be associated with an organization getting this city contract.

Sereno could not be reached for comment.

No-bid contract for young organization

Austin Public Health administers more than $40 million in City of Austin General Fund monies as well as federal and state funding, according to its website. The website states, “Programs must be evidence-based, research-based, or promising practices which promote self-sufficiency across a life continuum, from birth to old age.”

The agency awarded this contract to Equidad ATX without competition.

Jen Semp, a public information contact with Austin Public Health, said in a Wednesday email, “Austin Public Health Social Services agreements are exempt from local government code (Chapter 252), which requires competitive sealed bids or proposals before entering into a contract.”

The only documentation for the council agenda item was a Recommendation for Action, which states that Equidad ATX would “provide access to affordable groceries, health and wellness, and financial literacy resources to underserved communities for a 12-month term through March 31, 2022 in an amount not to exceed $400,000, with one 12-month extension option in an amount not to exceed $250,000, for a total amount not to exceed $650,000.”

The description of services in the recommendation states, “Equidad ATX will retrofit a bus donated by Capital Metro to convert it to a mobile resource hub and will support the coordination of other community partners to provide supplemental resources to meet service gaps in underserved areas. The program will serve to augment, not replace, investments in food access programs in the Fiscal Year 2020-2021 Budget. The program intends to serve Northeast and Southeast Austin and Travis County using a sliding scale as appropriate.”

One Equidad ATX webpage shows what appears to be the donated bus already converted and stocked with food. (See illustration.) The illustration states, “Central Texas Food Bank will operate the mobile grocery to serve residents on the Eastern Crescent.”

The Austin Bulldog has filed a public information request with Capital Metro for records about a bus being donated to Equidad ATX.

Corporate documents, tax returns

Equidad ATX Inc.’s Certificate of Formation was filed with the Texas Secretary of State March 15, 2018. Its board members listed in that document are Cumberbatch; Barbara Scott, president of the Colony Park Neighborhood Association; and attorney Jay Hailey, a sole practitioner according to his LinkedIn page.

Its most recent Texas Franchise Tax Public Information Report lists Cumberbatch as president, Hailey as secretary-treasurer, and Scott as director. Other directors include Christopher Rio, Judy Trabulsi, John Sidney Butler, and Michael Gibson.

Equidad ATX Inc. was approved by IRS for 501(c)(3) nonprofit status March 25, 2019.

Equidad’s 2018 tax return received by the IRS May 7, 2019, shows its total revenue that year was $2,500.

Its 2019 tax return reported total revenue of $55,007. That report indicates that Cumberbatch as president drew compensation of $9,000. No other board members were compensated.

Its 2020 return is not yet available through the IRS.gov website.

Winning the City contract of $400,000 for year one would increase Equidad ATX’s 2021 revenue by more than seven times its 2019 revenue, even it has no other sources of income.

Contract not the first city money

Records on Austin Finance Online show that Equidad ATX previously received $40,000 in city funding for “Education and Training Consulting,” as follows:

February 3, 2020—$20,000 under Purchase Order CT4400 20010700247 for Grants to Others/Subrecipients.

September 17, 2020Purchase Order CT 4400 20090301088 for Services-Other.

Both of these payments were requested by the City’s Innovation Office, where Equidad ATX Board Member Alba Sereno was employed.

Kazique Jelani Prince operates a Jalani Consulting LLC, which focuses on equity and cultural fluency in the workplace. Although the website is active, records maintained by the Secretary of State show that the company’s “charter, certificate or registration were forfeited February 28, 2020.

It’s not clear whether Jelani Consulting has derived income from Equidad ATX and Prince did not avail himself of the opportunity to answer that question.

Trust indicators: Ken Martin has been covering local government and politics in the Austin area since 1981. See more about Ken on the About page.

Links to related documents:

Equidad ATX Inc. Certificate of Formation, March 15, 2018 (4 pages)

Equidad ATX Inc. Form 990-EZ tax return for 2018, May 7, 2019 (13 pages)

Equidad ATX Inc. Form 990 tax return for 2019, undated (31 pages)

Equidad  ATX Inc. Texas Franchise Tax Public Information Report, May 3, 2019 (3 pages)

Equidad ATX Inc. IRS determination letter approving its exempt from federal income tax as a Section 501(c)(3) nonprofit, March 25, 2019 (2 pages)

Jelani Consulting LLC forfeiture letter from Texas Secretary of State, February 28, 2020 (1 page)

Recommendation for Action for Agenda Item 51 for Equidad ATX Inc., March 25, 2021 (2 pages)

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